Coinbase set to bring customers closer to regulated cryptocurrency assets
Cryptocurrency exchange Coinbase is set to bring people in the UK closer to the digital currency market by listing crypto assets that are compliant with local laws.
Coinbase, a start-up based in San Francisco, has introduced a new feature that will see it list a growing number of digital assets alongside Bitcoin, such as Bitcoin Cash, Ethereum and Litecoin, that align with regulations in different countries, boosting consumer confidence in their legitimacy.
The company was founded in 2012 to give people secure access to a financial system based on the blockchain, the decentralised ledger that facilitates cryptocurrency transactions. The digital currencies have gained increasing attention over the past year after a rally that saw their total market capitalisation soar to approximately $830bn in January before crashing to the current value of $200bn.
Coinbase currently operates in 32 different countries and has established recognition from traditional finance players in the UK after Barclays bank opened an account for the exchange earlier this year.
Zeeshan Feroz, UK chief executive of Coinbase, believes the new feature will give people outside the US a clearer, more transparent way of navigating the thousands of assets that continue to appear in the digital currency sector.
“Coinbase supports about five assets and clearly the market is much bigger than the five we support,” he said.
“We’ve been trying to figure out for a while what the best way is to support more assets in the currency market. We’ve taken a thoughtful and deliberate approach in terms of how we’ve done that in the past, but what we’re trying to do is upscale that.”
The listing process requires issuers to go through a ten page online form to provide detail around the assets they want to submit for consideration in a jurisdiction-by-jurisdiction manner.
The increasing diversification of crypto assets comes at a time when regulators debate how digital currencies and their associated assets should be monitored.
Earlier this month, finance ministers across the European Union met to discuss a potential framework for the regulation of cryptocurrencies, while the Financial Conduct Authority, the UK’s financial watchdog, is working with global institutions to better understand the industry.
Coinbase admits that its new listing process means that in practice, some assets will only be available to customers outside the US “for a period of time”. But according to Mr Feroz, it ensures only “high-quality assets” will be associated with Coinbase’s platform, and an ongoing dialogue with regulators will be critical to ensure clearer information is provided to potential new cryptocurrency consumers.
“Education in general is one of the top responsibilities that a crypto business has today,” said Mr Feroz.
“We are taking steps to address this. We started a listing page for the top 50 assets recently that will start to serve as a filter for actual information from all the noise you may get around assets, and allows ultimately for customers and regulators to make better quality decisions.”
